The Research On Individual Investors And Institutional Investors Sentiment With The Synchronization Of Stock Price

The synchronization of stock price is called "up or down" phenomenon on the market, which refers to the degree of the stock price by " up or down" at the same time in a period of time on the market. On the one hand, the synchronicity of stock price can effectively reflect the information content of the price. Based on the general thought, measure of stock price synchronicity is widely used as the information efficiency of the stock market to study the related issues. On the other hand, some irrational behaviors caused by market noise, bubbles, investor psychological bias, and investor sentiment will affect the synchronization of stock price to some extent, which has nothing to do with the company's fundamentalsThis paper describes the background and significance for the research in the first place, and summarizes the domestic and foreign the literature about the investor sentiment, herding effect and synchronicity of stock price, then explores the theory of limited rationality of investment and investor sentiment in the behavioral finance, and conducts the analysis to investor sentiment and stock price synchronicity mechanism, indicating that individual investors'irrational sentiment and behaviors can significantly weaken the synchronicity of stock price, and the behaviors of institutional investors can strengthen the synchronicity of stock price, and when the irrational behaviors of individual investors forming the market herding behaviors, they will amplify the synchronicity of stock price, institutional investors are the opposite. Next further investigates the characteristics of individual and institutional investors' behaviors in China's securities market in the fact. Second, on this basis, through the panel model in econometrics, extracting quarterly data from January 1, 2006 -- June 30,2014 on China A shares of non-financial listing Corporation,and respectively establishing the indexes of individual and institutional investors' sentiments,this section explores the relationship between individual, institutional investors'sentiments and the synchronicity of stock price. After that, the section analyzs the relationship between individual and institutional investors' sentiment and the existence of herding effect. Finally, this paper puts forward some constructive proposals and policies to optimize the investment behaviors in China's securities market, including consummating the information disclosure system, improving the professional knowledge and philosophy of individual investors, establishing the risk warning mechanism, standardizing the development of listing Corporation's behaviors and guiding the institutional investors in an orderly and effective way.